Together Women Rise awarded a $39,500 Planning Grant to Shared Interest, one of our past Featured Grantees. This investment will support meaningful systems change by achieving the goals of economic equality and increased decision-making power for women entrepreneurs.
The Challenge
According to Shared Interest, women are poised to become the driving force behind Southern Africa’s economic recovery from the COVID-19 pandemic. Funding their ideas and investing in their businesses will not only “help generate broad-based economic growth, but will also build resilience and support the development of strategies to address issues like nutrition, climate change, and energy poverty”, Shared Interest states.
Unfortunately, gender norms impede women’s ability to succeed as entrepreneurs. These norms affect women’s ability to seek loans and lenders’ willingness to provide them.
Common Gender Norms that Shared Interest Works to Change
- Women-owned enterprises should only grow large enough to support the family.
- Women’s business activities should never impose on household commitments.
- Married women should seek approval from their husbands on all financial decisions.
- Women should not hold assets in their own names.
- Women should perform lower-paying jobs or accept lower pay for the same work.
- Women generally lack the skills to successfully manage a business.
Small business owners of both genders have difficulty accessing capital in Africa, but women are especially disadvantaged because they rarely own assets, like real property, that are accepted by banks as security for debt. Collateral-based lending practices and other bank policies not only prevent women from obtaining credit, they even make qualified borrowers too intimidated to apply.
Globally, women lead fewer than 25 per cent of micro, small, and medium enterprises. In Africa, women receive less than three per cent of start-up financing.
Shared Interest’s Approach
Shared Interest’s major areas of focus include unlocking local capital; strengthening local resources, and benefitting local people in the areas of agriculture and food security, gender equity, climate change, social enterprise, and financial technology.
It works directly with financial institutions to change how the banking system services women entrepreneurs. It has successfully worked with lenders over time to reduce the amount of collateral they require from borrowers from 100% (or more) to as little as 25%.
Shared Interest is also championing key policy reforms that would revolutionize the way these institutions do business. It starts with addressing biases and misconceptions among bank staff and leadership that have resulted in negative experiences for women in the past. Then, it works to re-shape the approach and products offered by lenders so that future interactions will be positive, successful, and on an even footing with men.
For example, the way banks currently do business is unsuited to the realities of women’s lives. Most branches are in urban centers, and many women are unable to travel to these locations due to logistics and social norms. Loan applications include burdensome documentation requirements that many women are unable to satisfy. Shared Interest works with lenders to refine their policies, lowering barriers for women.
Our Partnership
Our Planning Grant allows Shared Interest to conduct data collection in Malawi, over one year, to identify the most impactful interventions to drive desired systemic change in the financial system. Shared Interest will also use this Planning Grant as leverage to secure additional funders for future phases of this important work.
By supporting Shared Interest’s work in Malawi, Together Women Rise is setting the stage for a longer-term partnership to create systemic change in the financial sector in Malawi, which is expected to spread to the larger financial markets of South Africa and Zambia.